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Buzz Bits: Markets Finish Week Slightly Higher


Your daily Buzz highlights...


Longest day ever! - Kevin Depew -

As we put the finishing touches on an obligatorily (is that a word?) green expiration session in honor of St. Patrick's Day, I am closing out the day vowing to:

1) Leave the office premises immediately.
2) Never again eat that for lunch.
3) Make any future decisions regarding sleep requirements before 3 a.m.
3) Sell some SPY here.
4) Learn to count better.

Meanwhile related to number 3 above, the other 3, Minyan Steve shared that he's seeing bearish divergences on the MACD (12,26,9) and RSI (14) onthe SPY. Also, he notes the weak percentage of new highs ("5.4% on the NYSE, Lowry's says 6% at market top,
spooky") and a rapid increase in percentage of stocks one standard deviation below their 40dma (22% and counting). Food for thought as we settle in for a short, two-day respite.

Have a great remainder to your St. Patrick's Day, Go Cats! and here's to an even better next week.

Flashback! - Bill Meehan - 3:34 PM

This day in market history...
  • Closing levels 2 years ago
    • DJIA: 10,300.30
    • Naz: 1976.76
    • S&P 500: 1123.75
    • Crude: 38.21
    • Gold: 406.50

This day in Minyanville history...

  • In '04, Prof. Succo described his Position after unwinding a year-end trade.

In other news...

  • In 1762, New York City played host to the first St. Patrick's Day parade.

Intraday Update From Rod David - MV Trading - 2:20 PM

The open's price action robbed sellers of their traction from yesterday afternoon, and put the "lunch hour reversal" setup back into development stages. But buyers didn't gain traction, and have yet to invalidate the reversal setup. It's not for lack of trying, but the tries have been inappropriately-timed. The latest was today's new session highs during the noon hour that failed to remain above yesterday morning's highs. The initial consequence of that misadventure was quickly felt by a steep drop back to this morning's lows.

A bigger consequence might be the additional evidence of "ineffectual bullishness" as more longs are trapped, mistaking sellers' patience for weakness. Unless/until this morning's SPX 1308.75 (ESm 1319'25) highs were recovered - and preferably the noon hour's high, as well - S&Ps remain vulnerable to a retracement back to last month's highs 10 points lower.

Hollywood Shuffle - Vitaliy Katsenelson - 1:10 PM

Over last couple of months we have done some reshuffling in our portfolios. We swapped Bemis (BMS), which had a nice run, for 3M (MMM ) which has been making lows for a while. In this trade we have upgraded in quality, at least in the perception of quality.

Also, we picked up a 1/2 position in Cendant (CD ) when it got slaughtered. As I mentioned on the Ville before we sold CD before the news of a split up as we did not see any catalysts for the stock going up. Well, the stock is cheap, despite its real estate and travel businesses facing possible headwinds. I believe its businesses will be worth a lot more to buyers on a stand alone basis.

We are also eyeing radio stocks which are making, or close to making, all time lows - things may not be as bad as they appear.

We picked up a half position of Symantec (SYMC) and Oracle (ORCL) a couple months ago; it seems that soon we may get a chance to get the other half of Symantec at a very nice price.

So to summarize, I am building a portfolio of quality companies - usually taking a full position in them once they get hit. Also, we are slowly adding (usually taking 1/2 positions) "broken" companies that that have a good chance to get fixed.

position in symc, orcl, mmm, cd

Semiconductors need a little help from the shorts.... - Phil Erlanger - 12:53 PM

And they are not going to get any help with short covering. Short intensity of semis has dropped to 44% from 53% in July. Short covering really helped these names in the third and fourth quarter. Such notables with no shorts include Texas Instruments (TXN), KLA-Tencor(KLAC) and Intel (INTC). There are still some semi names with heavy shorts. We note a very smart sellside analyst loves RF Micro Devices (RFMD) which has seen the shorts press their bets in the past two months. Short intensity of RFMD is now 91% with a short ratio of 3.61 (chart).

Well my father was a gambler down in Georgia,
He wound up on the wrong end of a Buzz... - Todd Harrison - 11:10 AM

Alrightee then, the Minx is slinkin' through a poker party with the four witches as I cast our eyes across my eight screens. What am I seeing? A little nub (homies), a little snub (semis) and alotta tea leaves (breadth, banks, nets) that are stuck in the middle with you. Hey, look on the bright side, we've got fresh tip-offs (sans Orange) in an hour and two days of kicked back madness after that. It could be worse...

Last night, while enjoying the Allmans, a Minyan walked up to me and said "tough coupla days, eh?" I looked at him and said, "Uh, not really--at least not more than usual--why?" He mentioned the bear costume (getting squeezed) and it was then that I realized how much I've matured in this business. I still care, of course, but my net worth and self-worth have completely decoupled. It's taken 16 years but it's a mighty fine frame of mind.

With that said, I'm paying my last respects to a slew of downsides--including some financials and IBM puts--and will ride a handful of positions and postures into next week. I'm torn on the "pop & drop" scenario which means, in my book, to do less. I may be old but my fingers are still quick enough to pull a trigger if I see something meaty. But I won't bet just to bet--that's a recipe for giveback and would be entirely inconsistent with the proactive patience I so often speak of.

Meanwhile, while Billy and Pepe plot their St. Patrick's spoonage, I'm hoppin' on a flight tonight to deliver a keynote at the Entrepreneurs Conference in Oregon. While I always tell President Fish that I'm the visionary and he's the entreprenuer, I'll do my best to represent. At the end of the day, affecting positive change through educational interaction is one of life's greatest gifts.

As always, I hope this finds you well.


All Bubble-Blowing Done on Premises - William Fleckenstein - 10:04 AM

Yesterday's midday strength appeared to coincide with a speech from Fed member Donald Kohn, which could easily have been titled "Bubbles 'R Us." He made it crystal-clear (in case anybody didn't know already) that the Fed has one policy, and one policy only: to print money. As their thinking goes: "We don't care if we create bubbles, because we can fix them." Obviously, the fact that they were able to arrest the unwinding of our massive equity bubble and turn it into a housing bubble (whose hangover has yet to be seen) has emboldened them to be even more brazen.

Though they appear to claim omniscience and clairvoyance on most subjects, when it comes to bubbles, they plead complete ignorance. Said Kohn: "Given how little we know about the dynamics of speculative episodes . . . I view our ability to act on such suspicions as limited." They're unaware of textbook accounts of the goings-on in 1929, the late 1980s in Tokyo, or even contemporaneous accounts of what occurred here in the late 1990s during our bubble.

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